Skeletogenesis proceeds through a series of phases in which resting chondrocytes within a cartilaginous anlage initiate proliferation, enter a hypertrophic state, and are replaced by osteoblasts that mineralize the surrounding matrix. This process is controlled by hormones and local effector molecules. In vitro the transforming growth factor betas (TGF- betas) have profound effects on both chondrocytes and osteoblasts. In vivo TGF-beta is an inhibitor of articular chondroctye differentiation, whereas in bone, TGF-beta overexpression causes a regional differentiation of osteoblasts to osteocytes and an osteoporotic state. These somewhat limited effects contrast with the widespread distribution of the TGF-betas in cartilage and bone as well as multiple skeletal defects in TGF-beta2 null mouse. We hypothesize that the involvement of TGF-beta in skeletogenesis is more extensive than reported because previous approaches failed to consider that TGF-beta action is controlled at the level of conversion of extracellular latent complex to the active form. We will examine the role of TGF-beta in cartilage and bone by using genetically manipulated mice that express either increased or decreased levels of active TGF-beta. We will manipulate the conversion of the normally latent TGF-beta complex, consisting of TGF-beta, the TGF-beta propeptide, and the latent TGF- beta binding protein (LTBP), to its active form, rather than altering TGF- beta gene expression or signaling. First, we will generate transgenic mice that express a form of LTBP that enhances activation of latent TGF-beta. Second, we will produce transgenic mice expressing a form of LTBP that suppresses activation. Each construct will be expressed using the collagen I promoter to target effects to early osteoblasts, the collagen II promoter to see effects during chondrocyte differentiation, and the osteocalcin promoter to establish the effects on osteoblast physiology. In addition; we will create a mouse in which the cysteine residue required for TGF-beta2 bonding to LTBP is mutated to serine precluding interaction of TGF-beta with LTBP resulting in excess TGF-beta activation. In vivo and in vitro histological and biochemical analysis of these animals should reveal phenotypes that yield insight into the role of TGF-beta in chondrogenesis and osteoblast biology. These experiments will contribute to the overall IRPG on Skeletal Modeling and Remodeling through interactions with other investigators interested in morphogenesis-(Project 1) and signaling (Project 2).